I am an entrepreneur and communications expert from Salt Lake City and founder of SnappConner PR. I am the author of Beyond PR: Communicate Like A Champ The Digital Age, available on Amazon. I am also a frequent author and speaker on communication and am co-creator of the Content University program for executives. The opinions I express (especially when tongue in cheek) are entirely my own. My newsletter is the Snappington Post, available at http://bit.ly/1iv67Wk

Star Wars, Elvis, Miller Lite: How Marketers Use 'Nostalgic Capital' To Cash In On The Past

Yes, it’s a “thing” – and savvy product developers and marketers know that the nostalgic capital that accompanies our sentimental emotions is a concept that is highly motivating to American and global consumers. In fact at least one product evangelist – Vladimir Vukicevic, co-founder and CTO of RocketHub, has done actual analysis on the way nostalgic affinity for the positive attributes we associate with familiar events from times past can mean big bucks for businesses emerging today.

Miller Lite. Star Wars. Elvis. Comic Con. Even Instagram. Each of these phenomena is successfully leveraging the concepts, the events and the emotions we equate with pleasant and fulfilling associations that we yearn to fulfill.

Entrepreneurs, are you listening? In a recent blog, Vukicevic plotted out the traditional S-curve of the economic value in the product life cycle of products and services that leverage nostalgic capital. Unlike technology products, he notes, products based on nostalgia will never dip below zero and its depreciation in value is a much more gradual declining slope over time.

Here’s how the value emerges:

An Establishing Event represents the beginning of nostalgic capital creation, Vukicevic says. It is the first time that a person, place, or product enters the consciousness of the public. It could be the initial release of a film (like Star Wars), the unveiling of a new product (Old Spice, or Miller Lite), or a music and cultural phenomena like Elvis, or the Beatles, or the Grateful Dead. The establishing event is rarely a single moment in time—rather, it’s time period that occurs while people experience the product or phenomena and engage with excitement at the new novelty. For example, Vukicevic pegs the establishing event range for The Beatles as ten years long (from 1960 to 1970),while the actual establishing event itself, Abbey Road (the 11th studio album by The Beatles), occurred during a much shorter time period of 6 and 12 months in 1969-1970.

The Gradual Appreciation period is next, as memory begins to overtake the reality of the asset. The asset begins to gain in nostalgic capital. The absolute value of the total nostalgic capital will vary greatly among different concepts. For example, the first Star Wars movie will produce a vastly different level of nostalgic capital from a pop culture phenomenon such as Paris Hilton’s mid 2000’s TV series, The Simple Life.

Rapid Appreciation of the nostalgic capital seems to occur 10 to 15 years following the establishing event and lasts for 5 to 10 years. This period often coincides with a shift “social generations” as a new league of predominant consumers emerges and previous generations move further down the ranks of the purchasing pole. Since World War II, this phenomena has occurred approximately every 20 years through the world, Vikucevic says.

The Nostalgic Apex period occurs approximately 20-30 years following the establishing event and lasts from 10-15 years. This period represents the greatest opportunity for marketers, product developers, entrepreneurs and creators to capitalize on the peak value of the emotion the nostalgic asset provokes. The nostalgic apex often represents a comprehensive and renewed embrace of a particular concept and tends to highlight the most positive aspects of the nostalgic asset. (Think the Osmond family. Marvel Comics. Beach cruiser bicycles. Tie-dyed t-shirts.) It is nostalgia at its grandest.

The Depreciation Period is last and represents the gradual de-emphasis of a particular concept. It is a slow cultural decline in significance and nostalgic value. During this period, other elements will move forward to play a larger and more prevalent role. This period also coincides, Vukecevic notes, with the gradual death of the generation that experienced the initial establishing event in the most personal and direct way.

As fewer people have a direct connection to the establishing event, the Historical Period begins. Nostalgia now becomes history. Emotion is gradually diminished around the phenomena more objective perspectives prevail. Past concepts are cemented into archives and consistent narratives that become more of a curiosity or a study, with less direct sentimental reaction attached.

An amazing concept. Now let’s take a look at a few of the people and the organizations who are currently putting nostalgic capital to work:

Comic Con. Comic Con International emerged in San Diego in 1970 when a set of comic book, movie and science fiction aficionados joined to create a comic book “mini conference” to celebrate their join interest. Since then, the phenomenon has emerged as an all out craze that is perpetual, since the event has grown to incorporate all aspects of fan-based shows and pop culture, giving the shows appeal far beyond the original “science nerd” crowd. Salt Lake Comic Con, the regional event I am most familiar with (disclosure: the Salt Lake show is an agency client) has broken all records for a first-time event with some 75,000 attendees. The event is now producing an estimated $30 million in economic benefit to the Salt Lake region per year and is producing ancillary benefits as a market ecosystem for other businesses involved in pop culture—crafters, authors, filmmakers, custom makers, etc. For Comic Con fans, nostalgia is big business.

Does this packaging look familiar? If you grew up in the 1970s it probably does.

Miller Lite. As one of the first mainstream beer manufacturers to offer a light beer alternative, Miller Lite emerged in 1975 to broad fanfare, including promotion by numerous celebrities and athletes. Since that time, the market for beer, wine and spirits has evolved heavily, including many light options that make Miller’s alternative harder to differentiate than before. The solution? The original Miller Lite in its traditional packaging, re-introduced for a limited time in a “The Original” campaign to evoke memories of the original product from decades ago (and to hopefully inspire the brand loyalty that goes along with the memories the original product provides).

Instagram. Instagram emerged in 2010 as one of many alternatives for photo creation and sharing. But to its credit, Instagram has differentiated by providing photo sizing and filtering options that are reminiscent of the traditional size and formats that were popular in the 1970s and 80s in Kodak and Polaroid pics. The photo filter options are reminiscent of the original photographic era as well. Instagram was purchased by its biggest competitor, Facebook, for $1 billion in April of 2012, proving that nostalgic capital is worth big money.

With thought, many other examples of current marketing and even entire business models that leverage “Nostalgia Capital” come to mind. Restoration Hardware. The show “Mad Men.” Could the concept play a role in your own present or future business? I welcome your thoughts.

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Thanks, Devin – of course we could cash in on a few prior establishing events…but I love seeing the examination of the science behind this and the way so many entrepreneurs have jumped in large and small to produce these results. Ideas everywhere. Thanks for your note!

I’ve seen this at work in the skateboarding industry over the past few years. Curiously enough, the guys who were at the height of their game 20 years ago are now making more money cashing in on the nostalgia felt by guys like me who now have quite a bit more disposable income than we did when we were 17. Well, some of us.

Thanks, Josh – and it’s pretty interesting, isn’t it? I bet they’re cashing in an entirely different way than they’d have predicted. I find this phenomena quite intriguing. Thanks for your note! Regards, Cheryl